October 18, 2011
To reinvent fire, we need to master six critical challenges.
1. Build efficient buildings and retrofit existing ones on a tremendous scale
Just one energy efficient building makes a difference. Multiply that by 120 million buildings, and, there will be a revolution. Ultimately, there’s a $1.4 trillion opportunity on the table for smart building owners and entrepreneurs to aggressively adopt straightforward efficiency techniques.
“There are several emerging trends that point to ‘cracking the code,’” said Mathias Bell, RMI consultant. “The challenge is to dramatically accelerate these nascent trends—like straightforward efficiency techniques and technologies—and leverage integrative design to achieve greater energy savings and financial returns.”
To jumpstart widespread investments in building efficiency, building owners, energy service firms and utilities need to spearhead change. The good news is that the time is ripe: the technologies are available, smart regional policies are proliferating, and the opportunity to deliver innovative hassle-free energy products at scale is increasing.
2. Transform the auto industry
A cleaner, safer oil free world—and the health of this vital sector—depends on the auto industry’s ability to produce much fitter vehicles at roughly the same cost before their competitors—both old and new.
A key enabler of the transition is to apply integrative design, vehicle fitness and new manufacturing methods, which can save far more fuel at a similar sticker price by simplifying automaking and shrinking powertrains.
“We are currently on the tail end of a 100-year learning curve, where we see design improvements flattening out,” said Greg Rucks, RMI transportation consultant. “Instead of wringing the last bit of innovation left in current designs, the same amount of innovation and design effort could be more productively applied toward revolutionary autos that exceed 100 mpg with better safety and performance. Automakers who recognize this early will be in the best position to capture market share.”
3. Dramatically reduce the distances traveled by autos and the haul length, weight and volume of cargo carried by heavy-duty trucks
Complimentary to transforming vehicle design is changing how vehicle are used—and it is important that both happen simultaneously.
Paying infrastructure costs by the mile not the gallon, smart IT traffic and transport systems, and other strategies can slash more than half the 13,000 miles a typical American drives each year and cut just under a third or more freight-hauling miles while enhancing personal mobility and freight logistics.
“Nobody wants to sit in traffic for hours, but that is today’s reality. We could provide the same or better transportation services with more options and only half as much drive time,” said Jesse Morris, RMI transportation analyst. “IT developments and smarter use of infrastructure could expand user choice and access.”
4. Sustain and accelerate energy savings and cogeneration in industry
As ubiquitous as “made in China” sounds, industry is still a huge piece of the U.S. economy, generating more than 40 percent of the country’s GDP and employing almost 20 million people. America’s strongest economic engine can become more competitive by accelerating adoption of energy efficiency, boosting cogeneration, and increasing on-site renewable supplies of heat and electricity.
“Industrial energy efficiency is profitable, but it requires courage to look beyond short term investments,” said Albert Chan, RMI consultant. But, gaining insight into energy use across the company delivers many more benefits other than cutting energy costs, including streamlined processes, improved product quality and increased performance. It’s no coincidence that firms that are good at energy management are also the most competitive.”
5. Keep driving down the cost of renewable energy
Today, the costs of some renewable and distributed technologies are still higher than the alternatives.
But, global growth in investment and production of renewable technologies—like wind and solar—is driving rapid cost reductions and improving performance. Using these commercially available technologies, there is more than enough renewable resource available to meet current and future U.S. electricity demand.
“Wind, solar, and other renewables are traveling down a steep learning curve,” said RMI Principal Lena Hansen. “With expected cost reduction trends for today’s technologies, the path to an electric system that is powered largely by renewables could be only modestly more expensive that business-as-usual.”
But, even with dramatic cost reductions, current regulatory structures and conventional utility business models hamper the industry’s ability to transform efficiently and profitably. That’s where #6 comes in.
6. Change the rules of electricity production
There will never be a future free of fossil fuels if utilities’ profits depend on how much electricity they sell, or if distributed renewable sources can’t feed electricity onto the grid.
While we cannot anticipate game changing events or the speed of transformation that can be enabled by technology, the electric system can be ready to respond quickly to threats and take advantage of opportunities.
“The key is to level the playing field for actors to make intelligent and economically optimal decisions,” said James Newcomb, RMI Program Director. “By revamping utilities’ rules and operating models to align with the opportunities presented by efficiency and renewables, we can build a more customer-centric and less risky electric system.”
Harnessing Powerful Interconnections
While pulling each of these levers is critical, it can’t be done in isolation. Reinventing Fire depends on the interdependencies of an entire system to uncover solutions that yield exponential economic benefits and find bigger savings cheaper.
By increasing our productivity with every unit of energy we use across all sectors of our economy—transportation, buildings and industry—we can simultaneously power our increasingly efficient demand with a portfolio of renewable energy sources.
Watch RMI’s new video to learn how we can change energy use forever. And, don’t miss the national launch of Reinventing Fire on October 27!